Question
1/ Which of the following is correct about the loanable funds market? The real interest rate reflects the rate of return lenders receive after accounting
1/ Which of the following is correct about the loanable funds market?
The real interest rate reflects the rate of return lenders receive after accounting for inflation.
Investment refers to household purchases of stocks and corporate bonds.
Savings > Investment in a closed economy.
All of the above are correct.
2/Financial intermediaries are
markets where lenders can directly lend money to borrowers, such as a stock market.
individuals who make profits by buying a stock low and selling it high.
a more general name for financial assets such as stocks, bonds, and checking accounts.
financial institutions through which savers can indirectly provide funds to borrowers, such as a bank.\
7/ If per capita GDP in the US is growing at 2% per year, approximately how long will it take for per capita income to double in the US?
50 years
35 years
100 years
70 years
10/Diminishing marginal product of capital means that each additional unit of capital adds
more output than the previous unit of capital.
less output than the previous unit of capital.
the same amount of output as the previous unit of capital.
nothing to GDP, so we should stop using capital and just give up.
11/ The government can promote economic growth by
Group of answer choices
promoting the rule of law, establishing property rights, providing incentives for research and development, and placing restrictions on trade to protect domestic producers.
increasing capital gains taxes to pay for new transfer programs, establishing property rights, providing incentives for research and development, and placing restrictions on trade to protect domestic producers.
promoting the rule of law, establishing property rights, limiting research and development, and removing restrictions on trade.
promoting the rule of law, establishing property rights, providing incentives for research and development, and removing restrictions on trade.
14/ Which of the following policies are NOT associated with higher levels of per capita income?
Property rights.
Free trade.
High corporate tax rates.
Public subsidies for R&D.
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